The 297,000 households living in the private rented sector are more at risk of experiencing energy poverty than those who own their own homes, according to a new report published today.
With the current focus on energy issues, ‘‘Warm Housing for All” - a joint collaboration between two national charities, the Society of St Vincent de Paul (SVP) and Threshold - is timely.
The report highlights that 55% of private rented properties have a BER rating of D or less, with 20% rated F or G.
Previous SVP research published in 2019 showed that children living in the private rented sector were two times more likely to experience energy poverty than those living in owner occupied homes.
Without action now, the charities are concerned there will be a growing gap in housing standards and increasing inequality in outcomes for private renters. The report sets out clearly the measures required to successfully improve energy efficiency and housing standards in the private rented sector.
The ‘Warm Housing for All’ report deals comprehensively with the situation in the private rented sector under five headings; current standards for energy efficiency, opportunities and barrier to retrofitting, financing retrofitting in the sector, protecting tenants, and a pathway forward, which contains 15 recommendations.
The report draws on insights provided by 17 stakeholders from industry, academia, government bodies and civil society organisations at the roundtable hosted in April 2021, as well as international evidence, research of the respective organisations and the experiences of their front-line services in supporting tenants in the private rented sector.
In relation to financing, the report highlights that energy efficiency improvements in the sector are particularly challenging without strong government leadership. A major barrier is the “split incentive” that occurs when a landlords meet the cost of improvements, but it is the tenant who reaps most of the benefits through reduced energy bills. On the other hand, tenants do not control their rental property and do not have the autonomy to make it more energy efficient, nor do they have the security of tenure to incentivise them to invest in energy efficiency measures. This means that neither party is strongly motivated to upgrade the building.
A number of proposals to overcome this “split incentive” are put forward by the organisations, including making properties in the private rented sector eligible for funding equivalent to the ‘Better Energy Warmer Homes Scheme,’ for low-income tenants and their landlords, based on a tenant receiving the Housing Assistant Payment (HAP). However, Threshold and SVP stress that eligibility should be contingent on the landlord providing a long-term lease to the tenant.
In relation to the opportunities and barriers, the report stresses the need to significantly increase the numbers employed in retrofitting to meet the current target of 500,000 retrofits by 2030. The charities say this is an opportunity to use public investment to create good jobs throughout the country.
It also recommends the establishment of One Stop Shops for the private rented sector. This is a service, promoted at EU and national level, that supports homeowners through the retrofitting process by providing a single point of contact. This report recommends that this service should be available and tailored for landlords and tenants in the private rented sector.
Ann-Marie O’Reilly, Policy Officer at Threshold said; “With one in five households now living in the private rented sector and the Government’s commitment to introducing a minimum BER in the sector by 2025, targeted measures, as well as funding, are required without delay to address the energy efficiency of private rental homes.”
Issy Petrie, SVP Research and Policy Officer said; “The ambitious target of 500,000 retrofits by 2030 has already been set by Government. With this report we want to make sure that households in the private rented sector benefit from this too. To reduce energy poverty, we need a coherent strategy that aims to tackle energy inefficiency in the private rented sector as well as addressing the cost of energy, and overall income adequacy. While not without its challenges, the benefits are wide ranging as it will not only improve the quality of the housing stock, but it will also help meet our climate targets and reduce health expenditure in the future.”